NZ CPI

NZ CPI  July 16, 2012

 We’ll be trading the Consumer Price Index (CPI) figure out of New Zealand today. CPI is Inflation, therefore it is a very high impact release. Here’s the forecast:

6:45pm (NY Time) NZ CPI q/q Forecast 0.5% Previous 0.5%
DEVIATION: 0.3% (BUY NZD 0.8% / SELL NZD 0.2%)
The Basic PlanOur focus will be on the headline CPI number. If we get a better release of 0.8%, we should be looking to BUY NZD; if we get a lower release 0.2%, then we’ll see NZD move down. Usually if our BUY or SELL figures are hit, we could expect the market to move about 40~50 pips within the next 30~90 minutes.


DEFINITION:“The Consumer Price Index (CPI) measures the rate of inflation (i.e., the rate of price changes) experienced by consumers when purchasing goods and services. A rising trend has a positive effect on the nation’s currency. The primary objective of the central bank is to achieve price stability; when inflation rises above an annualized rate of approximately 2%, they will respond by raising interest rates to bring prices down. Higher interest rates attract foreign investment, thus increasing demand for the nation’s currency. CPI is one of the most closely watched indicators and will usually have a high impact upon release.”

Recommended Pairs : NZDUSD.


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